UFC flexes $425 million second-lien term loan to Libor plus 750 bps

By Sara Rosenberg

New York, Aug. 3 – UFC Holdings LLC lowered pricing on its $425 million eight-year second-lien term loan to Libor plus 750 basis points from revised talk of Libor plus 775 bps and initial talk of Libor plus 850 bps, according to a market source.

The second-lien term loan still has a 1% Libor floor, an original issue discount of 99 and call protection of 102 in year one and 101 in year two.

Recommitments for the second-lien term loan were due at noon ET on Wednesday, the source said.

Along with the second-lien term loan, the company is getting a $1,375,000,000 seven-year senior secured covenant-light first-lien term loan B priced at Libor plus 400 bps with a 1% Libor floor and an original issue discount of 99.5.

The first-lien term loan has 101 soft call protection for six months and amortization of 1% per annum.

Earlier in syndication, the second-lien term loan was added to the transaction to replace an initially contemplated $500 million unsecured notes offering and was then downsized by $75 million, and the discount on the tranche was revised from 98.

Also during syndication, the first-lien term loan was upsized from $1.3 billion, the spread was cut from talk of Libor plus 450 bps to 475 bps and the discount was tightened from 99.

Goldman Sachs & Co., Deutsche Bank Securities Inc., Barclays, Credit Suisse Securities (USA) LLC, KKR Capital Markets LLC, Citigroup Global Markets Inc. and UBS Investment Bank are the leads on the deal, with Goldman the left lead on the first-lien term loan B and Deutsche Bank the left lead on the second-lien term loan.

Proceeds will be used to help fund the acquisition of the company by WME | IMG.

As part of the transaction, Silver Lake Partners and KKR will join WME | IMG as new strategic investors, along with MSD Capital LP and MSD Partners LP, which will provide preferred equity financing.

Closing is subject to customary conditions.

UFC is a Las Vegas-based sports brand and pay-per-view event provider. WME | IMG is an entertainment, sports and fashion company.

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